Frontier Communications reportedly charged a cancellation fee of $4,302.17 to the operator of a one-person business in Wisconsin, even though she switched to a different Internet provider because Frontier’s service was frequently unusable.
Candace Lestina runs the Pardeeville Area Shopper, a weekly newspaper and family business that she took over when her mother retired. Before retiring, her mother had entered a three-year contract with Frontier to provide Internet service to the one-room office on North Main Street in Pardeeville. Six months into the contract, Candace Lestina decided to switch to the newly available Charter offering “for better service and a cheaper bill,” according to a story yesterday by News 3 Now in Wisconsin.
The Frontier Internet service “was dropping all the time,” Lestina told the news station. This was a big problem for Lestina, who runs the paper on her own in Pardeeville, a town of about 2,000 people. “I actually am everything. I make the paper, I distribute the paper,” she said. Because of Frontier’s bad service, “I would have times where I need to send my paper—I have very strict deadlines with my printer—and my Internet’s out.”
In Pardeeville, Frontier’s website lists offers for DSL Internet service plans with speeds from 3Mbps to 12Mbps, but not for higher-speed fiber lines that are generally only available in bigger cities and towns. DSL speeds are often significantly lower than the “up to” speeds advertised by providers.
Lestina figured she’d have to pay a cancellation fee when she switched to Charter’s faster cable Internet but nothing near the $4,300 that Frontier later sent her a bill for, the News 3 Now report said. Charter offered to pay $500 toward the early termination penalty, but the fee is still so large that it could “put her out of business,” the news report said.
Business Internet plans have different terms
Business Internet service is generally offered under different terms than residential Internet service. Frontier’s business Internet terms and conditions, posted on the company’s website, say that customers terminating service must pay the monthly charges for all remaining months in a contract. By contrast, Frontier’s residential terms list termination fees of up to $400 regardless of how much time is left in the contract.
Lestina said the early termination fee wasn’t fully spelled out in her contract. “Nothing is ever described of what those cancellation fees actually are, which is that you will pay your entire bill for the rest of the contract,” she said.
Lestina said she pleaded her case to Frontier representatives, without success, even though Frontier had failed to provide a consistent Internet connection. “They did not really care that I was having such severe problems with the service. That does not bother them,” she said.
Instead of waiving or reducing the cancellation fee, Frontier threatened to send the matter to a collections agency, Lestina said.
News 3 Now spoke with Michelle Reinen, director of Wisconsin’s Bureau of Consumer Protection. When it comes to requiring specific disclosures to consumers, business Internet is subject to a more vague state law than residential Internet, Reinen said. The state law “doesn’t say that the service provider must disclose what the cancellation policy is,” but cancellation policies should be “part of the contract and negotiations,” she said.
“We want to see what’s happening here,” Reinen said, according to News 3 Now. “Is this a one-off situation [regarding] a specific contract, or is this a practice that we should be monitoring? Because we want to make sure the law is being followed appropriately.”
The matter hadn’t been resolved as of yesterday. “Candace hasn’t gotten a call from collections yet—in fact, she’s having a hard time getting in touch with Frontier,” the news story said. “So is News 3 Now—the company had not responded to our requests for comment as of 9am Thursday.”
We contacted Lestina and Frontier with questions today and will update this story if we get any more information.
Disclosure: The Advance/Newhouse Partnership, which owns 13 percent of Charter, is part of Advance Publications. Advance Publications owns Condé Nast, which owns Ars Technica.